Central processing of sensory information requires discrimination between relevant and irrelevant stimuli, that is, facilitation of response to some stimuli and inhibition of others. Nicotine appears to enhance this discrimination process in rat hippocampus by inhibiting the response of hippocampal cell populations to repetitive stimulation. The inhibitory influence of nicotine in rat hippocampus is mediated via the alpha7 subtype of nicotinic receptor. A critical question is why a single dose of nicotine can improve sensory discrimination for up to 30 minutes when nicotinic receptors desensitize much more rapidly. A possible explanation is that activation of nicotinic receptors leads to the release of a neurotransmitter or neuromodulator that itself has a protracted effect, either directly or via second messenger systems or regulation of transcription and/or translation processes. The alpha7 receptor is associated primarily with subpopulations of inhibitory neurons in rat hippocampus, including neurons immunoreactive for nitric oxide synthase (NOS), the synthetic enzyme for the production of the gaseous neurotransmitter nitric oxide (NO). This observation led to the hypothesis that alpha7-stimulated release of NO mediates the effects of nicotine in rat hippocampus. The hypothesis will be tested in Experiment 1 by examining the effect of intracerebroventricular (icv) infusions of the NOS inhibitor N-nitro- L-arginine methyl ester (L-NAME) on hippocampal auditory evoked potentials in anesthetized rats. Experiment 2 will examine the ability of icv infusions of L-NAME to prevent the restoration of hippocampal auditory-mediated inhibitory gating by the selective alpha7 receptor agonist GTS-21 in anesthetized fimbria/fornix-lesioned rats. Experiment 3 will examine the ability of icv infusions of a saturated NO solution to overcome the disruption of auditory-associated inhibitory gating induced by icv infusions of the alpha7-selective antagonist alpha- bungarotoxin in anesthetized rats. Knowledge gained from the proposed experiments may help elucidate the mechanisms by which nicotine exerts its persistent effects in the central nervous system.